New York’s Storm Recovery Plan Gets Federal Approval

“It’s up to the homeowner, and the vast bulk of homeowners are deciding to stay right where they are.” GOV. ANDREW M. CUOMO, on participation in a buyout program.

Nathaniel Brooks for The New York Times

By THOMAS KAPLAN

April 26, 2013

A proposal to buy the damaged homes of New Yorkers who want to relocate after Hurricane Sandy is finding few takers, as most residents opt to rebuild, state officials said on Friday.

“It’s up to the homeowner, and the vast bulk of homeowners are deciding to stay right where they are and rebuild,” Gov. Andrew M. Cuomo said at a news conference in Albany.

The state has allocated an initial sum of $171 million to buy homes in low-lying areas, part of an ambitious effort by Mr. Cuomo to reshape coastal land in the face of more frequent extreme weather. The governor has repeatedly warned about the threat of climate change.

“We can never make up for the hardship that people went through,” he said, “but we can use this as a learning and an improving opportunity.”

About 10,000 homes in the state were substantially damaged or destroyed by Hurricane Sandy, according to Cuomo administration officials. They estimate that the owners of perhaps 10 percent to 15 percent of them will pursue buyouts; that is the same share they projected when Mr. Cuomo was developing the plan in February.

“The only place where more than just a small handful want to relocate is a couple of communities on Staten Island,” Senator Charles E. Schumer, Democrat of New York, said at the same news conference. “Otherwise, just about everybody — you take Nassau, Suffolk, Queens — they all want to rebuild and come back, and I think that’s great. That shows the spirit of New York.”

The buyout program will be financed by a $51 billion federal aid package for states affected by the October hurricane.

On Friday, the government said that it had approved the use of $1.7 billion from that aid package for a rebuilding plan in New York State. A large fraction of that money will be used not for the buyout program, but for homeowners who choose to rebuild. Both state and city officials said they would help homeowners who choose to rebuild to do so in ways that would be more resistant to storm damage in the future.

New York City is scheduled to receive its own allotment of $1.8 billion. The housing secretary, Shaun Donovan, who leads the federal government’s Hurricane Sandy Rebuilding Task Force, said the city’s plan was likely to be approved in the near future, as was another plan developed by New Jersey officials.

For owners of homes that were substantially damaged and are in the most flood-prone areas, the buyout program will pay 100 percent of their prestorm market value. Homeowners in high-risk areas will receive a bonus to encourage them to move.

Some details about the buyout program remain to be ironed out; for owners of homes in other low-lying areas, the New York State rebuilding plan approved by the federal government describes a scaled-down program, offering the market value of the property after the storm. But a spokesman for Mr. Cuomo, Matt Wing, said state officials were still in discussions with the Department of Housing and Urban Development, and the officials were confident that federal money could be used so that all eligible homeowners would receive the prestorm market value of their home.

Buyout payments will be capped at $729,750 for single-family homes.

State officials project they could eventually spend as much as $400 million on home buyouts. Some of the land will be kept as open space, or turned into natural buffers like dunes and wetlands; other properties will be redeveloped, but any structures built there will have to be constructed to withstand flooding and storms.

The Staten Island borough president, James P. Molinaro, said his office had received calls from scores of homeowners seeking information on buyouts. He estimated that more than 600 properties could be sold to the government, including many in Oakwood Beach, on the eastern shore of Staten Island, and some in Midland Beach and Tottenville.

“Some people have said, ‘We’ve had floods in the last 10 years maybe three or four times,’ ” Mr. Molinaro said. “They say: ‘We want to get out of here. We’re afraid.’ ”

On several streets in Oakwood Beach, 170 of 184 homeowners have signed up for buyouts. Nearly all of them have already submitted buyout applications to the state, and appraisals were completed on most homes this week, said Joseph Tirone Jr., the leader of the Oakwood Beach Buyout Committee, a group that has spearheaded the relocation push.

Mr. Tirone is planning a meeting for early next month at which real estate agents and mortgage bankers will help residents begin to look for homes to which they can relocate.

Also on Friday, New York City’s commissioner of homeless services, Seth Diamond, said that about 1,000 people displaced by the storm remained in hotels. Speaking at a City Council hearing, Mr. Diamond said 600 of the evacuees could stay in the hotels through the end of May because they were about to move into permanent housing; others with no “housing transition plan” must leave the hotels by the long-stated deadline of Tuesday.